West Africa, the world’s leading cocoa producer, is grappling with the aftermath of a disastrous 2016/17 cocoa season. Over the last year, international cocoa prices have collapsed by one-third to ₤1529 by end-August 2017. The drastic drop in prices reflects softening chocolate demand and a historically large cocoa crop from West Africa. The region is on track to produce an estimated crop of 3.44 million metric tonnes (MT), up 20% from the 2015/16 season. The impact of the cocoa price slump has been devastating. Cocoa farmers’ incomes were slashed, leading to panic in cocoa growing communities; government budgets were gutted with billions of dollars in losses from cocoa export earnings; and, child labour resurged on cocoa farms.
Growth in the urban population of Africa can potentially lead to a US$1tn regional market for African producers by 2030. Agriculture and food processing are vital for creating this $1tn industry.
Africa spends US$35.4bn on food imports annually, despite being home to 65% of the world’s undeveloped arable land. Unless something drastic is done, demographic factors such as population and urbanisation, which bring about increased demand for food and changing consumption patterns, are expected to raise Africa’s net food import to over $110bn by 2025.
With more than 60% of its 1.166 billion people living in rural areas, Africa’s economy is inherently dependent on agriculture. More than 32% of the continent’s gross domestic product comes from the sector.
With more than 60% of its 1.166 billion people, living in rural areas, Africa’s economy is inherently dependent on agriculture. More than 32% of the continent’s gross domestic product comes from the sector. However, agricultural productivity still remains far from developed world standards. Over 90% of agriculture depends on rainfall, with no artificial irrigation aid. The techniques used to cultivate the soil are still far behind from what has been adopted in Asia and Americas, lacking not only irrigation, but also fertilizers, pesticides and access to high yield seeds. Agriculture in Africa also experiences basic infrastructural problems such as access to markets and financing.